The development means companies’ environmental and social performance is rapidly becoming a crucial factor as investor interest grows and accountancy firms develop new techniques to measure such performance.
Announcing the news, environment minister Michael Meacher said: ‘Investors, insurers, bankers and others are increasingly aware of business ethics, environmental liabilities and risks. At the heart of this agenda is better environmental reporting.’
On the back of a recent challenge from the prime minister the DETR wrote to 30 of the FTSE-100 companies urging them to report on environmental and social issues. The 22 will add to the 37 that already produce reports on how they minimise damage to the environment and their local communities.
BT and Cable and Wireless are some of the leaders in environmental reporting.
Now Orange, Vodafone, Energis and Telewest will also publish their first environmental reports this year.
Accountancy firms are playing a major role in developments, too. KPMG and PricewaterhouseCoopers are two of the leaders in this sector. KPMG’s UK head of environment Michael Kelly said: ‘The issues driving this are regulatory compliance, stakeholder and shareholder pressure, the City and investor interest. Operational efficiency is also a driver.’
Internally the firm cites savings of around Pounds 120,000 a year if all its 11,000 employees and contractors switch off their PCs for an hour at lunchtime.
A further Pounds 200,000 or 4,000 trees are saved if staff use 12 sheets of paper less a day.
Geoff Lane, partner responsible for environmental services at PwC, said: ‘The holy grail as far as the City and investors are concerned is to be able to compare company reports in this area. It’s a very new sector and there’s still a long way to go.’
Further proof of growing interest in these issues can be seen in the huge growth of KPMG’s and PwC’s environmental and social advisory units which have more than quadrupled over the past year.
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